Social Security: Bait and Switch Politics

Beginning in the early 20th century, the infiltration of Socialism/Progressives into American politics became strong. And Progressives such as Teddy Roosevelt, Woodrow Wilson, and Franklin D. Roosevelt were elected and pushed many socialist schemes into place. One such scheme was Social Security Insurance (SSI).

The idea of Social Security “Insurance” itself came from Germany, then a National Socialist Party (NAZI), government:

“By 1935, President Franklin Roosevelt embraced the German idea that there should be government-run “social insurance.” That wasn’t legitimate insurance, where participants have a contract, they pay premiums based on their life expectancy, the premiums are used to make productive investments that will cover the benefits, and the participants and their heirs have a property right to receive benefits that have been paid for. As the Supreme Court later affirmed in Flemming v. Nestor (1960), nobody has a contractual right to receive specific Social Security benefits — Congress can change benefit formulas at any time. Nobody has a right to pass on Social Security benefits to heirs, as is done routinely with private annuities, pensions, and life insurance.”

So not only was the plan not “insurance” but it carried none of the benefits of real insurance. The ideas for Social Security “Insurance” are rooted in the thoughts and writings of German philosopher Karl Marx who wrote The Communist Manifesto (1848) and Capital (1867–1894). It  should not be surprising that the German NAZI party centered in the same country, nor the Communism of the Soviet empire developed from its close neighbor, had strong socialist elements. The whole region was infected with this proven failed philosophy.

And that philosophy bled over to the Americas as well, including the United States. It was very popular and not hidden in the early parts of the 20th century. Later when the ugly reality of atrocities by the Nazi’s and Soviets came to light, over praise of socialism was less popular. But it did not go away.

Senator Robert F. Wagner, himself a German immigrant and again from that same socialist culture, was instrumental in writing the Social Security Act, and originally introduced it in the United States Senate. He also was instrumental in a number of other bills and acts that should be considered socialist and/or favorable to Socialism.

But it gets worse. FDR sold the idea of SSI based on ‘insurance’. But instead of insurance as marketed by FDR, it was a compulsory taxation:

Social Security promoters must have feared that private retirement plans would offer a better deal. Wisconsin’s “progressive” Democratic senator, Robert M. LaFollette, fumed that the Clark amendment “would be inviting and encouraging competition with its own plan which ultimately would undermine and destroy it.” Roosevelt threatened to veto the Social Security bill if it had the Clark amendment. Freedom of choice was eliminated during the House-House conference, and Roosevelt signed the Social Security law on August 14, 1935.

In case anyone doubted that Social Security was a monopoly, employers across America were required to display this notice: “Beginning January 1, 1937, your employer will be compelled by law to deduct a certain amount from your wages every payday. This is in compliance with the terms of the Social Security Act signed by President Franklin Delano Roosevelt. This is NOT a voluntary plan.”

But the plan was challenged at the Supreme Court, which was also threatened by FDR with takeover by FDR potentially appointing additional Justices increasing the number from 9 to 15 and in FDR’s favor.

Among the issues to be decided, it stated, were whether Social Security’s taxes were valid exercises of the taxing power in Article I, Section 8; whether providing the benefits was valid under the “general welfare” clause; and whether Titles VIII and II, the tax and benefit titles for old-age benefits, taken together, are an exercise of powers not granted by the Constitution.

Next, the brief described the Act. Title II’s old-age benefits “are gratuities (not based on contract, but based on a Congressional direction expressly subject to amendment or repeal).” Title VIII’s taxes “are not earmarked for any special purpose.” They are “true taxes, their purpose being simply to raise revenue . . . available for the general support of Government.” But in 1935 the Administration had told Congress and the public that the purpose of the taxes was to build up a fund to pay old-age annuities.

Obviously, the reason for calling Social Security’s levies “true taxes” was to argue that they were valid exercises of the taxing power, which the brief did. It also argued that indigence in old age was a national problem too big for private charity and state governments, and that old-age benefits were therefore valid expenditures to promote the general welfare. Since the titles were valid separately, they were valid in combination, too.

As to the charge that Titles II and VIII, taken together, create “a scheme for compulsory insurance invalid under the Tenth Amendment,” the brief denied this, flatly contradicting the Administration’s testimony to Congress in 1935 and its promotion of Social Security after passage as “insurance” and “annuities”: “Whether or not the Act does provide an insurance plan within the accepted meaning of the term ‘insurance’ is a doubtful question.”

The Administration contrasted World War I’s War Risk Insurance for servicemen, which had policies which, “being contracts, are property and create vested rights,” with pensions, which are “gratuities” involving neither contracts nor vested rights and which Congress could take away. Not possessing the legal properties of insurance, Social Security wasn’t insurance, hence was constitutional.

So we ended up with something marketed as “insurance” that was not, but was a tax of a kind that is not allowed by the U. S. Constitution.  FDR played fast and loose with the Constitution in order to push through his Socialist/Progressive schemes, actually imported from Germany’s Third Reich, into this country.


3 thoughts on “Social Security: Bait and Switch Politics

  1. I love the facts you present, thanks for all your research. Something must be done or the USA is doomed, and I think most of us “regular” citizens know it.

    What the GOP has done at the RNC shows how deeply the corruption runs. We must vote Obama out, so Romney gets our vote, but those who are trying to manipulate the processes in such a way as to fence out true Conservatives are going to have a rude awakening very soon. Agenda: First get rid of Obama, then rectify the Republican establishment… or start a third party.

    It’s time we actually had a political party that held to the Constitutional Christian Conservative views of the majority of Americans, and it’s looking less and less like that party is the GOP. Like Sarah Palin said, the Republican Party arose from the ashes of the Whig Party, a party that had turned a deaf ear to the people they were elected to represent. Now the Republican Party seems to be following that same fatal course.

    It’s not a matter of the under-handed way the GOP disenfranchised Ron Paul, though that was despicable (even if my man was Newt), it’s the way they disenfranchised the entire Republican Primary process and, by that, disenfranchised Conservatives throughout the USA from having their true votes counted. If the will of the people isn’t part of the process, then the process is irreconcilably broken.

  2. That’s interesting. A synopsis would have made a solid conclusion. Help me understand.

    1.) Are you saying FDR created SSI for the sole purpose of creating revenue?

    2.) If SSI is not profitable, why are the elderly worried about losing it?

    3.) What is a better plan? 401K? I remember Romney was big on repealing SSI and encouraging privatized retirement funds, but I have inadequate math-related cognitive skills, so I find it difficult to follow.

    • To answer:
      1) Yes and no. Creating revenue is just one aim. The ultimate aim is redistribution of wealth, from the producers to the takers; socialism. Gaining power by increasing control over the citizens by taking that production is another. I could go on….
      2) SSI is not profitable by definition. Profit is the increase in wealth, the residue from ones work after the costs of performing that work. Nothing the Government does produces anything. They ONLY take from others. The government is a taker, not a producer. And moreover, SSI is a tax. And it is a Ponzi scheme since in the end, it will run out of money to take and give to others.
      3) A better plan? The 401K is better. It is really nothing more than a savings/investment account and in that way, the same as the retirement that millions had before being impaired in that investing by the government. When a person had a business, a farm, any occupation, and grew that business he was creating his own retirement. A 401k is a legal device protecting the investment from the government. But be sure, the government would like to remove those restrictions and get their hands on it.

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